Unemployment Rate Falls, But So Does Participation

May 2, 2014

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U.S. job growth
increased at its fastest pace in more than two years in April, suggesting a
sharp rebound in economic activity early in the second quarter.

Nonfarm
payrolls surged 288,000 last month, the Labor Department said on Friday. That
was the largest gain since January 2012 and beat Wall Street's expectations for
an increase of 210,000. March and February data were revised to show 36,000
more jobs than previously reported.

"The economy really has strong underlying
fundamentals supporting its growth. Temporary headwinds such as the bad weather
can be certainly managed," said Russell Price, senior economist at Ameriprise
Financial in Troy, Michigan.

Still, the
report did give some worrisome signals on the economy's health.

While the
unemployment rate dived 0.4 percentage point to a 5-1/2 year low of 6.3
percent, part of the decline was because hundreds of thousands of people left
the labor force.